Summary
I came across a web site that had tried to be a magazine and was clearly having trouble. I think all attempts to simply transfer the magazine format to a web site haven't worked as expected.

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Here's an example. Note the short articles on the front page, indicating that they haven't figured out how to make money.

I think the solution will require a mental twist, an insight we haven't seen before. Tip jars and advertising are just a variation of what was done in print magazines (subscription fees and advertising).

Apparently Google is working on a system whereby advertisers only get paid for an actual purchase. I would buy advertising like that (if it wasn't too hard, and if the publisher asked for a reasonable percentage of the sales price), because it's basically no risk; if something doesn't sell then I haven't risked advertising dollars on it. Can't get much better than that, and if Google does this I suspect it will produce a rush of new advertisers into the market. In fact, I'll bet it would reverse the normal order of things -- you'd have more of a marketplace, where, instead of publishers vying for advertiser dollars, advertisers would also be vying for publisher space, because there would be far too many ads for the amount of space available.

A friend of mine, William Gates (of Kansas, not Redmond) created a print magazine called Midnight Engineering way back when, that served its niche so well that he had no advertising staff. The advertisers contacted him and just bought space; he never had to solicit. Because of this and other areas that he had streamlined, he could publish the magazine all by himself. Bloggers are in basically the same boat, except that they have neither the time nor the energy that William had to invent a whole new way of doing things. Bloggers want to be able to say "here is some ad space -- take care of it for me in an optimal way."

Well, not really. What they really want to be able to say is: "pay me for the time and effort I put in on writing."

> because it's basically no risk; if> something doesn't sell then I haven't risked advertising> dollars on it. Can't get much better than that, and if> Google does this I suspect it will produce a rush of new> advertisers into the market. In fact, I'll bet it would> reverse the normal order of things -- you'd have more of a> marketplace, where, instead of publishers vying for> advertiser dollars, advertisers would also be vying for> publisher space, because there would be far too many ads> for the amount of space available.

It would also reverse other things. If I only get paid for sales, it's does me no good to put ads on my site for things that don't sell. I'd much rather put an ad on my site for MS Windows than for penis-shrinking pills, for example. What I mean is, it would be like spam where the low cost means you can advertise for things that wouldn't normally warrant purchasing ad space. It would also enable people to advertise for things when they don't intend to sell anything (for money) like political ads.

> It would also reverse other things. If I only get paid> for sales, it's does me no good to put ads on my site for> things that don't sell. I'd much rather put an ad on my> site for MS Windows than for penis-shrinking pills, for> example. What I mean is, it would be like spam where the> low cost means you can advertise for things that wouldn't> normally warrant purchasing ad space. It would also> enable people to advertise for things when they don't> intend to sell anything (for money) like political ads.

Exactly what I meant by a marketplace. The publisher wants ads that make them money, and the advertiser also wants this, but in addition they now have the freedom to try experiments. Probably the experiments would land on less desireable blogs until they start making money, then more desireable blogs would accept them and they could move up some kind of hierarchy.

It has the potential of creating a very different picture of advertising.

In both there's an interleaving of the author's words and an editor's comments, and the formatting is especially poor for helping us see the difference. The first one is especially egregious, with its repetition of title, subtitle, and photograph..

> Exactly what I meant by a marketplace. The publisher wants> ads that make them money, and the advertiser also wants> this, but in addition they now have the freedom to try> experiments. Probably the experiments would land on less> desireable blogs until they start making money, then more> desireable blogs would accept them and they could move up> some kind of hierarchy.> > It has the potential of creating a very different picture> of advertising.

OK, so a website would be able to choose which ads to display? Wouldn't everyone pick the same ads? What would be the impetus to choose an ad for a product that doesn't sell?

> OK, so a website would be able to choose which ads to> display? Wouldn't everyone pick the same ads? What would> be the impetus to choose an ad for a product that doesn't> sell?

I don't think a blogger would normally want to have to think about the ads.

I think the ads would be automatically chosen based on a combination of the blogger popularity (desireability of the site) and advertisement value (desireability of the ad -- not sure how this would be calculated other than "how many sell-throughs have happened in the past").

A third factor would be percentage that the blogger recieves for a sell-through of the product.

And I could see this as an automatic dynamic bidding process.

So a blogger with lower popularity would either take high-value ads at a very low percentage, or low-value ads at a high percentage.

An advertiser with an ad that hadn't had any sell-throughs yet would offer a higher percentage of the sell-through, and as the product showed success, it would "move up the desireability queue."

yay, Midnight Engineering (http://en.wikipedia.org/wiki/Midnight_Engineering) was great, I bought it religiously for a while. When W. Gates was looking at the web I chatted with him over email about the choices. Great guy, as far as I could tell, always very optimistic and finding creative avenues everywhere he looked. The story of him getting the printing press sytem dirt cheap was precious.